Boosting Growth

Reducing the top rate of income tax to 45p, so Britain no longer has the highest rate of income tax in the G20 will boost growth. The 50p rate undermines our competitiveness and new evidence, endorsed by the independent OBR, finds that it only raises a fraction of what was intended.

Today in the third day of debate on the Finance Bill I spoke about this:

Much of the discussion on the 50p rate has been on whether it is an economic decision or a political one. My viewpoint is very simple. If we wanted a nice, easy time, and if our Ministers wanted a nice easy ride on the "Today" programme, where all those nice, gently liberal-leftie, metropolitan BBC people would congratulate us on doing nothing whatever, we would have left the higher rate at 50p. I am sure Owen Smith would have approved and been happy to congratulate us. If, on the other hand, we wanted to take action and do the right thing economically—the one thing that really matters is getting this country growing as quickly as possible—even if it were politically hard for us to sell, we would support the entrepreneurs, wealth creators and aspirant people who create the jobs and money that make this country go. For my money, that is the bottom line. The economics trump the politics.